"It will take a rally of monumental proportions to save the penis of John McAfee" - Zerohedge, 2017

Saturday, June 4, 2016

Some weekend reeding

New Deal Demoncrat - May jobs report sucked. His takeaway is that "this should stop the Fed dead in its tracks." Well, if people are leaving the workforce because they can't get raises because there's no such thing anymore in the US as worker bargaining power, then yeah, I guess we'll never see wage-based cost-push inflation, and thus interest rates will remain at zero forever. Ain't it nice how the kleptocratic rentier class is getting exactly what they want, right hard up the ass?

Every now and then, I like to remind you that you are reading the right blog. Because if I don't pat myself on the back, nobody else is going to, so please bear with me.

Anyway, the weakness in jobs growth was clearly forecast by a downturn in the Labor Market Conditions Index since last summer. I'm not just talking in retrospect, because I made exactly this forecast.

Or, you could have kept it simpler and just said that labour market condition is a lagging indicator, and the US fell into an industrial recession months ago, and that's why we should have expected bad jobs reports by now. In any case, yeah, the Fed's argument was that cost-push inflation from wages would be the reason for raising rates, and this report kinda scuppers that position now.

Calculated Risk - good years have bad months too. Some perspective based on past data. Just in case, y'know, you're reading some clown TA who feeds you news headlines as if they're his analysis.

the argument that there will be long term costs with Brexit has not, as yet, convinced most voters. In this poll, which is not unique, only 22% of voters thought they would be worse off as a result of Brexit.

Believe a blog, or facts. Up to you.

WSJ Moneybeat - hold your nose and buy Europe. Jason Zweig's thesis is that since European stocks are trading at 40% lower price-to-book, and 69% higher dividend yield, you should buy Europe.

I would respond to him that when you buy US stocks you buy superior growth potential. Meanwhile, European leadership has explicitly come out in favour of continuing a deflationary collapse: that is what's being reflected in relative valuations, you clown.

But don't believe me: name one single European stock that yielded a higher return than its US competition over the past ten years.